Saturday, August 22, 2009

Try fundamentals

Someone sent me an email (how about posting to the blog instead) after I lamented about the problems with technicals lately, saying I should try fundamentals. Which fundamentals would that be? The 81st bank failure of the year last week? Over 9% unemployment? Public opinion polls saying they are still not buying anything? Record foreclosures?

Technicals may be acting funny now but they beat fundamentals hands down, any day of the week. At a very minimum, there is a trend.


Antonio said...

As I wrote three days ago, the market is being manipulated. It has been noticed, for instance, that someone placed a buy order of 10000 futures on the S&P a few minutes before the bell, to force mm200 breakout up; similarly, by forcing important technical figures you have the market going up, but is only short covering. It is also possible that economic official data are being manipulated: every time the market is on the verge of a sell off, there are better than expectations data or optimistic statements by policy makers...
Maybe it is not impossible to prop the market for a while: buying leaders in sectors during the first half hour in a sell off attempt, disoriented bears cover shorts and stay away; but clever bulls also don't play in these markets. The real thing is that the Fed is trying to buy time; but in this dangerous game, where manipulated mass media scatter false scenarios and Cnbc hammers "buy on dips" , I think there is only Goldman Sachs who gathers stocks.

Quick Takes Pro said...

I cannot argue with this. However, I cannot blame everything on someone else, either.

What we do agree is that when it ends it will not be pretty